PSBA vs.

CA

G.R. No. 84698 February 4, 1992

PHILIPPINE SCHOOL OF BUSINESS ADMINISTRATION, JUAN D. LIM, BENJAMIN P. PAULINO, ANTONIO M.

MAGTALAS, COL. PEDRO SACRO and LT. M. SORIANO, petitioners,

vs. COURT OF APPEALS, HON. REGINA ORDOÑEZ-BENITEZ, in her capacity as Presiding Judge of Branch
47, Regional Trial Court, Manila, SEGUNDA R. BAUTISTA and ARSENIA D. BAUTISTA, respondents.

PONENTE : PADILLA, J.

TOPIC : Source of Obligations - Contracts

PRINCIPLE : When an academic institution accepts students for enrollment, there is

established a contract between them, resulting in bilateral obligations which both parties are bound to
comply with. For its part, the school undertakes to provide the student with an education that would
presumably suffice to equip him with the necessary tools and skills to pursue higher education or a
profession. On the other hand, the student covenants to abide by the school's academic requirements
and observe its rules and regulations.

FACTS

A stabbing incident on 30 August 1985 which caused the death of Carlitos Bautista while on the second-
floor premises of the Philippine School of Business Administration (PSBA) prompted the parents of the
deceased to file suit in the Regional Trial Court of Manila (Branch 47) presided over by Judge (now Court
of Appeals justice) Regina Ordoñez-Benitez, for damages against the said PSBA and its corporate officers.
At the time of his death, Carlitos was enrolled in the third year commerce course at the PSBA. It was
established that his assailants were not members of the school's academic community but were
elements from outside the school.

Specifically, the suit impleaded the PSBA and the following school authorities: Juan D. Lim (President),
Benjamin P. Paulino (Vice-President), Antonio M. Magtalas (Treasurer/Cashier), Col. Pedro Sacro (Chief
of Security) and a Lt. M. Soriano (Assistant Chief of Security). Substantially, the plaintiffs (now private
respondents) sought to adjudge them liable for the victim's untimely demise due to their alleged
negligence, recklessness and lack of security precautions, means and methods before, during and after
the attack on the victim. During the proceedings a quo, Lt. M. Soriano terminated his relationship with
the other petitioners by resigning from his position in the school.

Defendants a quo (now petitioners) sought to have the suit dismissed, alleging that since they are
presumably sued under Article 2180 of the Civil Code, the complaint states no cause of action against
them, as jurisprudence on the subject is to the effect that academic institutions, such as the PSBA, are
beyond the ambit of the rule in the afore-stated article.

The respondent trial court, however, overruled petitioners' contention and thru an order dated 8
December 1987, denied their motion to dismiss. A subsequent motion for reconsideration was similarly
dealt with by an order dated 25 January 1988. Petitioners then assailed the trial court's disposition
before the respondent appellate court which, in a decision * promulgated on 10 June 1988, affirmed the
trial court's orders. On 22 August 1988, the respondent appellate court resolved to deny the petitioners'
motion for reconsideration.

ISSUE

Is this a case of an obligation arising from a quasi-delict or a breach of contract?

RULING

Because the circumstances of the present case evince a contractual relation between the PSBA and
Carlitos Bautista, the rules on quasi-delict do not really govern.

When an academic institution accepts students for enrollment, there is established a contract between
them, resulting in bilateral obligations which both parties are bound to comply with. For its part, the
school undertakes to provide the student with an education that would presumably suffice to equip him
with the necessary tools and skills to pursue higher education or a profession. On the other hand, the
student covenants to abide by the school's academic requirements and observe its rules and
regulations.

Institutions of learning must also meet the implicit or "built-in" obligation of providing their students
with an atmosphere that promotes or assists in attaining its primary undertaking of imparting
knowledge. Certainly, no student can absorb the intricacies of physics or higher mathematics or explore
the realm of the arts and other sciences when bullets are flying or grenades exploding in the air or
where there looms around the school premises a constant threat to life and limb. Necessarily, the school
must ensure that adequate steps are taken to maintain peace and order within the campus premises
and to prevent the breakdown thereof.

In the circumstances obtaining in the case at bar, however, there is, as yet, no finding that the contract
between the school and Bautista had been breached thru the former's negligence in providing proper
security measures. This would be for the trial court to determine. And, even if there be a finding of
negligence, the same could give rise generally to a breach of contractual obligation only. Using the test
of Cangco, supra, the negligence of the school would not be relevant absent a contract. In fact, that
negligence becomes material only because of the contractual relation between PSBA and Bautista. In
other words, a contractual relation is a condition sine qua non to the school's liability. The negligence of
the school cannot exist independently of the contract, unless the negligence occurs under the
circumstances set out in Article 21 of the Civil Code.

DISPOSITIVE PORTION

WHEREFORE, the foregoing premises considered, the petition is DENIED. The court of origin (RTC,
Manila, Br. 47) is hereby ordered to continue proceedings consistent with this ruling of the Court. Costs
against the petitioners.

SO ORDERED.